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Use Tax Rules feature to add taxes to purchased products.

To enable Tax Rules go to  Admin Panel>>Sytem configuration>>Tax Rules.

Taxes can also be enabled sitewide under Billing Settings.

You can activate/deactivate, edit and delete tax rule. Inactive tax rules will be ignored by the system.

Adding New Tax Rule


Use "Add Tax Rule" button to add taxes.

Tax Name - enter tax name

Country- select country this tax will be applied for. For example, if user selects "Canada" as his country under his profile, then this tax will be applied to this user when he will purchase products from your site.You can set your country list here.

State - select State this tax will be applied for. You can set your state list here.

Tax Rate- selected percentage value from the initial product's cost. For example, if product costs $100, 10% tax rate will add additional $10.

Active- check this checkbox if you would like to activate this tax. Inactive tax rules will be ignored by the system.

Price includes tax- check this checkbox if you would like the price of the product to include taxes.

If "Price includes taxes" is not checked, users will see following result ( tax rate is added in addition to the initial $100 price):

If "Price Includes taxes" is checked, users will see following result ( tax rate is included into the initial $100 price) :

 

You can not create two tax rules with the same country and state.

Hierarchy of tax rules

Let's assume you have several tax rules:

  1. tax rule for any country and any state
  2. tax rule for particular country(example: USA) and any state
  3. tax rule for particular country(example: USA) and particular state (example: Arizona)

In this case system will match tax rules based on the following scenario:

If user hasn't specified any country/state in his profile, №1 tax rule will be applied. All other rules will be ignored.

If user has specified particular country (example: USA) but has not specified the state in his profile, №2 tax rule will be applied. All other rules will be ignored.

If user has specified particular country(example: USA) and particular state(example: Arizona) in his profile, №3 will be applied. All other rules will be ignored.

 

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